Coalition's NBN will need ongoing, costly upgrading, experts warn

By Ben Grubb

The Coalition's planned broadband infrastructure will "freeze" broadband speeds, and need ongoing and expensive upgrading to resemble the system that Labor is already building, IT experts have warned.

Labor's national broadband network (NBN) is connecting fibre cables to many homes and business, while the Coalition plans to link fibre cables to "nodes", which would then link to individual users via copper wire.

But, he said, "how will the Opposition address that issue in five years' time or so? There is nothing in the ... plan that addresses this issue, beyond their initial quick and cheap fix, still at a considerable cost."

The Australian Information Industry Association said it was concerned that the proposed model compromised speed and "potentially also the overall quality and longevity of the network".

"Guaranteed speeds of 25 to 50 megabits per second fall far short of the promised 100 megabits per second to be delivered by the current NBN model," said AIIA chief executive Suzanne Campbell.

Communications Minister Stephen Conroy said the Coalition's policy was "like building the Sydney Harbour Bridge with only one lane".

Instead of spending Labor's $37.4 billion building a fibre-to-the-premise broadband network for 93 per cent of homes and businesses, the Coalition will spend $20.4 billion, mostly using a cheaper technology called fibre-to-the-node, that would deliver minimum download speeds of 25 megabits per second (Mbps) and maximum speeds of 100Mbps to 71 per cent of premises.

This would involve building about 60,000 cabinets, or "nodes", on street corners, connecting them to fibre cables and then piggybacking on the old Telstra copper telephone lines to reach premises. It would also require the successful renegotiation of Labor's $11 billion dollar contract with Telstra, which currently involves disconnecting copper as Labor's NBN is rolled out.

Fibre-to-the-premise technology will be delivered to 22 per cent of premises and, like Labor, the Coalition is making use of satellite and fixed wireless to deliver service to the last 7 per cent.

But while the Coalition's NBN would cost about $17 billion less than Labor's and would be completed two years sooner — in 2019 instead of 2021 — IT experts wonder how long it could last.

Telstra's copper is ageing and the Coalition will need to spend billions of dollars to maintain it.

Turnbull clueless on copper damage: iiNet

Steve Dalby, chief regulatory officer at internet provider iiNet, said he couldn't believe that Mr Turnbull didn't seem to understand that there would be a large cost when it came to hooking up customers using the Telstra copper network.

Mr Turnbull said on Tuesday that there were two approaches the Coalition's NBN could take where Telstra's copper was in poor condition: fixing the copper that can be fixed, or replacing copper with fibre.

When questioned about the lifespan of the copper network, Mr Turnbull said "nobody knows".

"It may be a very long time, but it depends on the technological developments," he said. "I'm knowledgeable enough and modest enough to know that you can't predict the future with great certainty."

"So [Mr Turnbull] doesn't know what it's going to cost him [to replace damaged copper cables] and he doesn't know where the problems are or the scale of the problems in relation to the existing infrastructure," Mr Dalby said. "I think it's a much bigger issue than he is giving credit for.

"I know so many people that say 'when it rains, my broadband drops out' or 'I can only get 1.5Mbps' or 'I can only get dial-up'. There are going to be a lot of people lining up saying 'I'm one of those case studies, I want you to have a look at my case and I want you to replace my copper'.

"So suggestions that he will only spend $29.5 billion probably ignore the fact that ... there will be a lot of people still unhappy with the performance of their telecommunications services," he said.

Coalition policy a 'lemon'

At his press conference, Mr Turnbull said the Coalition NBN would deliver "speeds that are more than capable of delivering all of the services and applications households need".

Telstra's former chief internet scientist Geoff Huston, who now works as chief scientist for APNIC (an organisation that assigns the numbers that underpin the internet IP addresses to providers such as iiNet and Optus) said that Mr Turnbull was trying to convey that what we did on the internet today was what we would do for the next 30 years.

"I would like to think that what we're doing 30 years [from now] only fibre could handle."

Dr Huston said that the worst thing experts could do when trying to predict people's internet activities was assume that yesterday's traffic was going to be the same as tomorrow's.

"All experience points precisely to the opposite," he said.

"While it might look like today's computers can do 25 Mbps and that's just fine, you and I and everyone else have no idea of what the world's going to look like in 10 years' time. But I can guarantee that it's going to take a lot more than 25 Mbps [per house] to feed it," Dr Huston said.

Dr Huston, along with senior Melbourne lecturer Mark Gregory at RMIT University's school of electrical and computer engineering, said that the policy was "a lemon".

"I would side with the view that this one is indeed a lemon," Dr Huston said. "And we've already learned from the [Remote Integrated Multiplexers] (mini telephone exchanges Telstra deployed that became bottlenecks) years ago that this kind of hybrid solution is extremely difficult to actually upgrade and replace.

"And quite frankly, 25Mbps in 10 years' time – that speed is going to look like what a [dial-up] modem looks like to us today. Too little, too slow, too backwards."

He added that the Coalition's policy would see download speeds "freeze" due to constraints inherent with poor-quality copper cables and fibre-to-the-node equipment.

"Effectively what you are doing in this kind of hybrid solution is you are freezing at a certain level of capacity, and then if you try and augment that, you've actually got to re-do the entire network – and we know how much that costs in today's dollars. [It's] not pleasant."

Said RMIT's Dr Gregory: "There's no guarantee of course [the Coalition] will get the telcos on board.

"I estimate that it would take two years to get any agreement with Telstra and with the telcos ... The Coalition plan is a lemon. I just think that it's just not going to provide what they say."

But Grahame Lynch, founder of the Australian telco industry website CommsDay, said the Coalition's plan was a great advance on its previous plan.

"I actually think people should give Malcolm Turnbull some credit for dragging his party as far as he has on this.

"Six years ago under Helen Coonan ... they were proposing to spend nothing more than about $1 billion or $2 billion on broadband – so they've definitely come a long way."

Mr Lynch said he would recommend the Coalition plan to friends and family because, on balance, it looked "better to me from a technology and [roll-out] speed point of view".

"It is probably better than we thought it was going to be," he said. "From a cost point of view, maybe not as good ... but on an overall balance you're going to get an upgrade to your network quicker and cheaper and that's going to mean something that is important for a lot of people."

He said it could be argued that a fibre-to-the-premise network now would make an NBN future-proof.

"But as we can see now, we're in a humming economy with labour shortages and so on and so forth. It's not necessarily an easy thing to do in the here and now."

By contrast, telecommunications industry analyst Paul Budde said the Coalition's decision to primarily use fibre-to-the-node was the "less favourable option" and called its plan “half-baked”.

“I prefer to call it 'step one',” Mr Budde said. “Where is the rest of the policy? If step one is all there is, it remains a half-baked product that in the end will prove to be more costly in the long run [as] eventually the old copper will need to be replaced and who will be paying for that?”

Mr Budde said "critical details" on how the Coalition would achieve a cheaper outcome, even at lower prices, remained a big question.

“The roll-out of fibre-to-the-node [maintaining the old copper network] is increasingly becoming a less favourable option. With the ongoing ageing of the copper network, that problem will only increase, [as] working with an old network means that you will come across many 'surprises' in that network that need to be fixed and that will either increase the costs or make it impossible for people to get true fast broadband," Mr Budde said.

Telco analyst Foad Fadaghi, research director with Telsyte, said he had some concerns about the Coalition policy.

"Yes, in the short term it could be good enough. In the long term, 10 or 20 years into the future, 25 megabits per second will certainly not be enough.

"There will be a need to move beyond fibre-to-the-node, eventually."

Mr Fadaghi said fibre-to-the-node may only be a good interim solution, especially if commercial interests were able to subsidise fibre connection to homes in return for providing content in a similar way telcos subsidise mobile handsets, for example.

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However, it would not future-proof Australia's infrastructure and may affect multinationals' decisions to invest in the country.